MPS — Q3 FY26 earnings call

Call held 2 Feb 2026

Management summary

MPS Limited reported a 'challenging 'holding quarter'' in Q3 FY26 with a minor dip in revenue to INR 182.5 crores, while 9M revenue grew to INR 563.2 crores. Despite this, the company maintained a healthy Q3 EBITDA margin of 31.6%. Education Solutions emerged as a strong performer, growing over 38% in 9M FY26, while Research Solutions remained a stable anchor. Corporate Learning experienced a significant pullback, prompting a strategic realignment. The company also announced the acquisition of Unbound Medicine for USD 16.5 million, a move expected to drive growth in the medical and nursing ecosystems. Management expressed confidence in surpassing an EPS of INR 100 for FY26 and anticipates an 'exceptional year' in FY27.

Highlights

  • 9M FY26 revenue grew to INR 563.2 crores.

  • Q3 FY26 revenue was INR 182.5 crores.

  • Q3 FY26 EBITDA margin stood at 31.6%.

  • Education Solutions grew over 38% in 9M FY26.

  • Research Solutions contributed 61.1% to 9M FY26 revenue.

  • Research Solutions achieved 16.2% YoY organic revenue growth (excluding AJE).

  • Education Solutions Q3 revenue grew 11.3% YoY with an EBITDA margin of 40.8%.

  • Acquisition of Unbound Medicine for USD 16.5 million was announced.

  • Management expects to surpass an EPS of INR 100 for FY26.

Key financials

  1. Revenue ₹563.2 Cr
  2. Revenue ₹182.5 Cr
  3. EBITDA Margin 31.6%

What they filed

Q1 FY27: revenue up 24.0%, net profit up 41.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue87 90 94 100 111 +28%108 +20%119 +27%124 +24%
EBITDA35 34 35 34 44 +26%41 +21%48 +37%54 +59%
Net profit27 29 27 29 30 +11%25 −14%44 +63%41 +41%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Research Solutions
    61.1% 9M Revenue Contribution16.2% Organic Revenue Growth (ex-AJE)
  • Education Solutions
    38% 9M Growth11.3% Q3 Revenue Growth40.8% Q3 EBITDA Margin
  • Corporate Learning
    — Q3 Performance

Guidance & targets

Profitability

  • EPS Profitability · FY'26 · High confidence surpass INR 100
    MPS is comfortably placed to surpass an EPS of INR 100 in FY'26.

    — Rahul Arora, Chairman and CEO

Revenue

  • Q4 Performance Revenue · Q4 FY26 · Medium confidence better quarter
    Based on the guidance I've shared, we expect a better quarter in Q4 itself

    — Rahul Arora, Chairman and CEO

  • AJE Revenue Stability Revenue · FY '27 · Medium confidence stable revenue
    FY '27 to be a stable revenue for AJE

    — Rahul Arora, Chairman and CEO

  • Education Business Growth Revenue · FY'27 · Medium confidence grow in double digits in a stable way
    Education business... we're expecting to grow in double digits in a stable way.

    — Rahul Arora, Chairman and CEO

  • Corporate Learning Business Growth Revenue · FY'27 · Medium confidence returned to growth
    in the Corporate Learning business, we returned to growth as well as in FY'27.

    — Rahul Arora, Chairman and CEO

  • AJE Revenue Stability Revenue · FY '27 · Medium confidence stable revenue
    We're expecting FY '27 to be the first year for AJE to show some stable revenue.

    — Christine Miranda, Senior Vice President, Research Solutions

Overall Performance

  • FY27 Outlook Overall Performance · FY'27 · High confidence exceptional year
    FY'27 in general, looking like an exceptional year.

    — Rahul Arora, Chairman and CEO

Risks & concerns

  • Challenging Q3 performance / Revenue dip

    medium

    Q3 was a 'challenging 'holding quarter'' with a 'minor dip in revenue to INR 182.5 crores' and 'a bit of a surprise for everyone on this call.'

    Management acknowledged

  • Corporate Learning segment underperformance

    medium

    'Corporate Learning saw a significant pullback.' 'MPSi Liberate and MPS Europa both operated below the prior year's budget revenue levels.'

    Management acknowledged, proactive measures

  • Labour Code related adjustments

    medium

    'impact of the new Labour Code related adjustments; which is about INR 3.5 per share.'

    Management acknowledged

  • Rapid decline in AJE

    medium

    'rapid decline in AJE to stall and FY '27 to be a stable revenue for AJE'

    Management acknowledged, proactive measures

  • Impact of AI on business segments

    low

    Management views AI as an 'opportunity' rather than a 'threat,' consolidating a fragmented market and boosting scaled players like MPS. AJE B2C portion is potentially impacted, but B2B is growing.

    Analyst downplayed, opportunity

Areas of evasion (2)

  • Specific financial details of Unbound acquisition before public filing
  • Exact breakdown of EPS calculation beyond the INR 100 target

Q&A highlights

3 direct
M&A (Unbound Medicine) strategy and business model Direct
Unbound overall is a high-margin, subscription-led business model. Recurring revenue is similar to our platform business. The business is primarily a B2B business focused on medical schools and nursing schools in the U.S. and Canada.

Clarifies the strategic rationale and operational model of the significant Unbound acquisition, including its B2B focus and recurring revenue nature.

Asked by Rahul Jain from Dolat Capital

EPS guidance for FY26 and implied Q4 growth, and long-term growth trajectory Direct
I shared before that we don't like giving guidance, but given that Q3 was a bit of a surprise for everyone on this call. We are providing some high-level EPS guidance, which is that we're expecting to cross INR 100 EPS, which, as you can imagine, having known us for a while now, that it's a conservative number.

Addresses analyst concerns about the Q3 performance and provides context for the FY26 EPS guidance, while also hinting at a conservative estimate.

Asked by Navid Virani from Bastion Research

Challenge on FY26 EPS guidance (INR 100 vs. prior TTM INR 104) and Corporate Learning segment's underperformance Direct
We are comfortably placed to cross an EPS of INR 100. That's all I shared, and there was some concern from people who attend these calls that there's going to be a miss on that number. We normally don't like to give guidance, and that's why we've given tight conservative guidance. There are a bunch of numbers that are bigger than INR 100, but that's all we can share at this point in time.

Directly confronts a discrepancy raised by an analyst regarding EPS figures and provides management's perspective on the conservative nature of their guidance and the strategic restructuring in Corporate Learning.

Asked by Madhur Rathi from Counter Cyclical Investments

3 min read 7 chapters

Detailed narrative

Q3 FY26 Performance and Strategic Reset

MPS Limited reported a 'challenging 'holding quarter'' in Q3 FY26, with revenue dipping to INR 182.5 crores. Despite this, the company maintained a healthy EBITDA margin of 31.6%. For the first nine months of FY26, revenue grew to INR 563.2 crores. Management initiated an 'Andon Cord' project for radical cost optimization, aiming to expand margins and strengthen the balance sheet, indicating a disciplined reset to prepare for future growth.

Unbound Medicine Acquisition

The company announced the acquisition of 100% stake in Unbound Medicine for USD 16.5 million. This acquisition is described as a 'transformative milestone,' moving MPS directly into the medical and nursing ecosystems. Unbound operates on a high-margin, subscription-led B2B model, primarily serving medical and nursing schools in the U.S. and Canada, with strong institutional stickiness and a 97% retention rate across 480 institutions.

Research Solutions Segment Performance

The Research Solutions segment continued to be a stable anchor, contributing approximately 61.1% of the total revenue in 9M FY26. The segment achieved an impressive 16.2% year-on-year organic revenue growth, excluding AJE. Strategic focus includes transitioning to AI-powered workflows, prioritizing AI models, and scaling DigiCorePro to drive sustained profitability and operational excellence. Management expects the rapid decline in AJE revenue to stall, with FY27 projected as a stable revenue year for AJE, driven by B2B partnerships and expanded services.

Education Solutions Segment Momentum

Education Solutions emerged as a standout performer, growing over 38% in the first nine months of FY26. In Q3, the segment's revenue grew by 11.3% year-on-year, and its EBITDA margin expanded to 40.8%. The business is building on momentum with major K-12 and Higher Education customers, converting pilots into product development and international projects. The digital and accessibility arm delivered excellent growth, handling complex work and expanding new service lines like LMS and web accessibility.

Corporate Learning Segment Challenges and Realignment

The Corporate Learning business experienced a 'significant pullback' in Q3 FY26, with MPSi Liberate and MPS Europa operating below prior year's budget revenue levels. This segment is undergoing a strategic realignment, moving away from low-margin legacy work and consolidating operations across entities (Switzerland, India, Australia). The focus is shifting towards higher-value capabilities, AI-enabled solutions, immersive training projects (VR, AR), and managed learning services, with early signs of success emerging.

AI as an Opportunity, Not a Threat

Management views AI as a significant opportunity, not a threat, for MPS. They emphasize that AI transformation requires execution across the entire value chain, which MPS is uniquely positioned to provide due to its domain expertise and ability to service end-to-end client needs. While the B2C portion of AJE might see some impact, the B2B segment is leveraging AI for efficiency and speed. For Unbound Medicine, AI is integrated to supercharge data but does not disrupt its core value proposition, which relies on verified, peer-reviewed clinical guides.

FY26 and FY27 Outlook

Despite the Q3 challenges, management expressed high confidence, stating MPS is 'comfortably placed to surpass an EPS of INR 100 in FY'26,' which they consider a conservative estimate. They anticipate a 'better quarter' in Q4 FY26 and project FY27 to be an 'exceptional year' with Education Solutions growing in double digits and Corporate Learning returning to growth. However, they noted a negative impact of INR 3.5 per share on EPS due to new Labour Code related adjustments.

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